By Bill Tumas:
If you're a subscriber to our YouTube channel, you're probably familiar with this '67 Mustang convertible. We've done a lot of upgrades to this car over the years, the most recent being a T5 swap to replace our tired 3-speed transmission. Speaking of tired, the original 289 in our car has well over 100,000 miles on it. It's definitely in need of a rebuild.

Well, there are plenty of options for rebuilding our engine. In our case, we're not terribly worried about originality, so we're going to pull our 289 and replace it with this Ford Racing crate engine.

Crate engines, such as this 306 cubic-inch engine from Ford Racing run a nice alternative to a costly and time-consuming rebuild of the original engine. To keep costs down, they use a remanufactured crank, rods and a block with brand new pistons, aluminum heads, a high-performance cam shaft, Edelbrock intake, and a Holley carburetor with an MSD distributor.

This 302 is the same physical size as our 289 and will only require a few modifications to make it fit in our car. We'll be installing a new water pump, which is not included with the engine, but we can use the rest of our '67 accessories. We will have to swap out the oil pan, as it does come equipped with a pan for a Fox body; we'll have to install a correct front sump pan for our '67.

Our Ford Racing crate engine ships ready to run, but we will still need a few parts to install it properly in our '67 Mustang. For starters, we'll need a fuel line adapter to adapt our Holley carburetor to our factory fuel line. We'll also need an MSD ignition box, such as the 6A or 6AL, to run the supply distributor. Like I mentioned before, the engine did not come with a water pump or a flywheel.

In the case of our '67, we've already installed a T5, so we're using a late model bellhousing. We use the matching 157-tooth, late model billet steel Ford flywheel, get over this hi-flow water pump, and since the engine ships with a Fox- body pan, we're going to convert it to a pan and pickup that'll properly fit the front sump on our '67 Mustang.

While we have the engine out, we feel it's a good time to do some upgrades as well. I'm going to go with this Champion aluminum radiator, Flex-a-lite fan, new thermostat housing, as well as a new thermostat, a high-flow fuel pump from Edelbrock, a brand new set of motor mounts, and a set of these billet pulleys, and these blue valve covers from Ford Racing to dress up our engine bay.

For this installation, you'll need a jack and jack stands or lift, an engine hoist, a set of ratchets and extensions, a good set of sockets, a set of standard wrenches, a 1/4-inch Allen head, a 5/16 Allen head, a 9/64 Allen head, adjustable wrench, screwdrivers, hammer, pry bar, cordless impact and cordless drill, Sawzall, needle nose pliers, wire cutters and wire strippers, 3/8 and 1/2-inch torque wrenches, flashlight, marker, and safety glasses.

You also need three gallons of anti-freeze, four quarts of ATF, five quarts of oil, 3/8-hose and clamps, two 3/8 NPT to 3/8 barbed fittings for your fuel pump, WD40, grease, thread sealant, thread locker, zip lock bags, and zip ties.

Obviously, the first step is to remove our original engine. In our case, we're going to disconnect the battery, put the carb in the air, and then drain all the fluids. Start by releasing the petcock to drain the radiator. We're going to drain the oil next. Draining our T5, this requires a 3/8 ratchet that goes right in this bolt, here.

Now that we drained our cooling system, our engine, and our transmission, we're actually going to remove the transmission and the drive shaft, to make it easier to remove our engine, itself. We're going to start by removing the support plate installed in our convertible.

For a job this size, you're going to be removing a lot of hardware. It's not a bad idea to grab some zip lock bags, label everything as you take it apart, so you remember where it goes.

We have to remove the H-pipe part of our exhaust so we can get our transmission out. In the case of ours, it's bolted in the front and it's welded in the back, so we have to cut the pipe off to remove it.

After cutting the H-pipe, now we can disconnect it from the header. The next step's going to be to remove our drive shaft. To do that, we remove the retainers at the rear-end itself, so you're going to remove the U- joint and remove the drive shaft.

Once you pull the drive shaft off, a plastic bag and a zip tie will make sure any more fluid doesn't drip out of the tail shaft of your transmission.

The first step in removing our transmission is going to be to remove the bolts that hold our crossmember to our chassis. I'm going to remove this bolt here so we can remove our speedometer cable. Before we separate the transmission from the bellhousing, I'm going to take off the harness here for your backup parts. Pop that off. We have ours tied to our transmission, so we're going to cut that out of the way.

Now we can remove the transmission to bellhousing bolts. With the trans bolts, we can start working the transmission loose at the bellhousing. A couple shakes back and forth will do it.

Our plan is to try to remove the motor by keeping the bellhousing attached to it. Usually we have enough space to do that. The headers might get in the way, but we're not going to know until we try. Before we can do that, though. We need to disconnect our clutch cable, free it up so we can get it out of the way.

We have to remove this bolt, here, to access the actual cable. We'll release the locknut here, so we can release tension on the cable. Now we get a hold on the cable itself, and we'll unthread the adjustment nut. Going to remove the c-clip that holds the cable to the bellhousing. I'll push the whole cable through the bellhousing.

The power cable for our starter comes underneath the motor mount, so we have to remove it from our starter before we try to remove the whole assembly. Now we're going to remove the bolts that hold the whole motor mounts to the engine itself: one here, one behind it, and then another two on this side. While we're down here, we'll get this bolt right here that has the engine's grounds on it.

Now remove the rubber hose from the fuel line coming in through the apron. While we're down here, we'll remove the lower radiator hose.

Now that we have our '67 back on the ground, we're going move her to the engine bay and disconnect what we have to up here to get our engine out. First step, remove the hose, here, to get our radiator out of the way. Take off the fan, and start working on the engine. Our radiator is held to our radiator support by four bolts. There are going to be two at the top and then two more down at the bottom.

The Monte Carlo bar is going to come out next. So, as we're trying to pull the engine with the headers and bellhousing attached, we're going to have to pull it forward to get it out. To give it some more space, we're going to pull off the fan and fan spacer. Now we're going to disconnect some of the wiring for our electric choke, oil sender, temp sensor, some of their wires are attached to the engine.

The last step for the cooling system removal is to disconnect the two heater hoses. One that goes to our intake, the other one that goes to our water pump. We're going to remove our throttle spring and disconnect our throttle linkage. Now we'll disconnect the other side. This'll give us a little more space when we're working.

Because we're leaving our bellhousing attached, or at least going to try to, we're going to use a lift plate that actually bolts where the carburetor bolts lift our engine out of place. To do so, we're going to remove the carburetor. First remove the fuel line, then the four retaining nuts that hold the carburetor to the intake manifold. With our carburetor off, we can install our lift plate.

The last step of getting the engine out of the car is going to be to remove the hood. It's not necessary to remove it, but it's going to give you more room to work with, so we're going to take it off. To pull the engine out of the car, it's going to require a cherry-picker like this. If you don't have one, the light to do ones are actually surprisingly easy to afford, plus a lot of places will rent one to you.

Well, close but no cigar. Our aftermarket headers are going to hit our export brace. They simply don't have enough space to get it past them, so we're going to remove the export brace to get our engine out of the car.

Now that we have our engine out, there's a few things that we're going to take off this engine and put onto our new motor. For starters, we're going to keep the alternator since it's fairly new. We're going to need the bellhousing, the clutch. We're going to hang onto our headers as well. Put the engine on an old tire. It makes a great place to work on it.

Next, we'll remove the two bolts that hold the starter to our bellhousing. Now we'll remove the bellhousing bolts. Next, we'll remove the clutch. Even though our flywheel is fairly new from our T5 conversion, its balance is 28 ounces, which will work with a vintage motor, but will not work with the new Ford Racing engine, which is balanced at 50 ounces. Now, the last part we're going to take off our old engine, for now, is going to be the headers.

Now that we've got all the parts we need off our old engine, we're ready to repair our new engine for installation. In our case, the first thing I'm going to do is swap out the included valve covers for our blue Ford Racing. I'm going to get a closer look at the roller rockers Ford provides on the engine. When tightening down your valve covers, you'll want to start with the bolds in the center and then work your way outward.

Now we're ready to install our high-flow water pump. The pump comes with the gasket. We also sell a bolt kit which comes with everything you need as well as a detailed diagram. The easiest way to get started is to use these three bolts here as a basis for getting the pump mounted. All three are the same size are the easiest ones to use.

Just going to get them snug for now. You don't have to tighten the all the way down just yet. Now we're going to install the rest of the bolts according to the diagram. The last two bolts we're going to install are going to be these two right here. If you have a power steering car, the power steering bracket mounts behind the bolts, so manual steering like our '67, you'll want to install the two supplied washers. Now we'll torque everything at 13.5 foot-pounds.

We're ready to start mounting the accessories in the front of the engine, but we're going to start with the alternator. Instead of using the old brackets, I'm going to use these new chrome brackets. Just want to get it snug so it still moves freely. The upper bracket's going to mount right here to these water pump bolts. We're going to remove both those bolts and install our upper bracket.

With our alternator brackets on the engine, we ready to mount our alternator. Our Ford Racing pulley kit comes with this two-piece billet pulley, so first we're going to pull the stock pulley off and swap it out. Now we can mount our alternator to our engine. Spacer in place, and line everything up; thread it in. Tighten down enough that it still can turn. Now bring the lower bracket into place. We'll leave that loose for now so we can get the belt in place, and then we'll tighten it down and adjust it.

Now we can move on to our crank pulley. The pulleys that we're using were designed by March to work with the four-bolt crank on our modern engine, but you can still use the factory-style early accessories. In our case, we're going with a twin groove on the crank as well as the water pump. We're doing that so we can add power steering in the future.

The water pump pulley is held on by the screws that go through our fan and our fan spacer. We're not going to install them at this time because the fans can get in the way when we put our engine back in our car. When it goes together, it's going to look something like this when it's finished.

We'll be using a mechanical fuel pump with our engine. Ford provides this block off plate, but there is an eccentric installed so you can use a mechanical pump. You simply remove the block off plate to install the pump. The pump will slide straight in. If it doesn't line up with the holds, you don't want to force it into place. You want to crank the engine over until it moves the cam enough for the pump lines up. Now we're going to put our gasket on. We'll install our pump.

Now we can install our thermostat, and our thermostat housing. Thermostat installs in the housing with the spring facing towards the engine, and the gasket goes on like this before the assembly goes on to the car. I found putting a little spray glue on the gasket will help keep the gasket and the thermostat seated, making sure you don't get a leak when you install it. Let's let that dry for a minute before we install it.

Next, we're going to install a new oil pressure sensor and the extension. To do so, we have to remove the plug that Ford supplies in the block. We'll start with the extension. You want to put a little thread sealant on the threads before you install it. Our new sensor already has threads and sealant installed, so we can thread around to our extension.

The supplied dipstick and tubes not going to work with our new pan and in our '67 Mustang, so we're going to remove the dipstick and tube before you remove the pan.

Ford ships our crate engine without oil in it, so we can simply flip it over and remove the pan. The four bolts on the end caps are going to be larger than the smaller bolts holding the pan to the block. Once the pan's off, you have to replace your oil pump pickup as well. You can see the pickup's designed for the Fox body. The one we're going to be installing is designed for the front sump we're going to use in our '67.

Before we install the new pan, we're going to pull off the gasket, replace it with the new one. I know it's a brand new gasket on a brand new engine, but better safe than sorry. Now we're going to install the correct pickup with the new gasket. While you have the pan off, you'll want tap out that insert in the front so you can use the correct style dipstick and tube for our '67.

Before we can install our pan, we have to address this hole here. This is where the factory-included dipstick goes into the block. Obviously we're not using it because we're using the dipstick in the front. If you try putting the metal tab in that you removed, I would suggest it. In our case, we're going to tap it and install a plug.

Spray a little oil on there for the tap. Put a dab of thread seal on the plug, and we'll install. Now we can put our gasket on and prepare to install our new pan. Now we can put the '67 front sump style pan on.

We're just about ready to put our engine back in our '67 Mustang. Since we were able to get the old engine out with the headers attached, we're going to install them on the stand, which makes it a lot easier than trying to install them in the car. Now that we have our headers installed, we're going to install the lift plate, and get the engine ready to go back in the car.

We have our 306 off the engine stand and hooked up to our crane. We're just about ready to start reinstalling it. Before doing so, thought, we're going to install a few things that are much easier to install here than actually in the car. We're going to start with the flywheel, then install the clutch, the bellhousing, and finally the starter before we install everything else.

The first step is to install a pilot bushing, because the engine does not include one. You'll want to install the correct pilot bearing or pilot bushing, depending on your application. In our case, we're using a T5, so we're going to install the pilot bushing. It gets hammered into place. An easy way to do so is to get a one-inch or equivalent socket. Fits over the bearing, line it up, and hammer it in.

Put the separator plate on first, and then we can install our flywheel. We'll use a dab of loctite on all the bolts for the flywheel. Then we're going to torque all these bolts down to 85 foot-pounds. Now we can install our clutch. The clutches come with plastic alignment tool. If you get your hands on an old input shaft from the transmission, it does a much better job.

Once the bolts are installed, we'll torque at 35 foot-pounds. Once we're torqued down, we can remove our alignment tool, move on to the bellhousing. Now we'll torque at 25 foot-pounds. Now that our bellhousing's installed, we're going to move onto our starter. Move onto our motor mounts. The last step before we put our engine in, pull our new dipstick and tube. Give our engine bay a quick cleaning, so the last thing to do before we can install our new engine is remove the old mounts.

We've done everything we could do on the stand, so now it's time to put our crate engine into our mustang. Once you have the engine drop down into place onto your motor mounts you probably want to get some help, because it's going to be kind of tough to get the engine to line up with the bolts for your motor mount.

Now we have the bolts on. We'll put the retaining nuts in place. Since we have the car up in the air to tighten the motor mounts, now is a good a time as any to put the transmission back in the car. Their crossmember mounted, we can reinstall our drive shaft. Move towards the front and reroute our clutch cable. We didn't tighten the lock nut down yet, because we're sure we're going to have to adjust our cable once we get it back together. We put it roughly where it was before. We'll do fine adjustments once the car's back on the ground and running.

Now we'll reconnect our speedometer cable. Don't forget while you're down here to plug in your backup lights. Tie the harness out of the way. That's it for down here for now. We're going to put the car back on the ground and go up to the engine bay. We're going to start with a cooling system now. We've got to install the temp censor as well as the heater hose elbow onto intakes. We're going to start by removing these two plugs. Going to start with the temp sensor. Put a little thread seal on before you install on the intake.

Our heater hose elbow, it actually is going to hit our distributor when we try to install it. As soon as we go to turn it, we're going to pop the distributor out, so we can get this threaded in place. I'm going to put the distributor back in our engine. Don't worry about getting it installed properly. We have to take it right back out once we prime our engine. We won't be needing our lift plate anymore, so we can take that off; reinstall our carburetor.

We'll start with our heater hose connections. Their heater hose is mounted, and now we can move on to the radiator. Champion's going to bold right to our stock mount. Now we can install our water pump pulley and our fan. Now we can put our belt on. Next, we'll put on our upper radiator hose.

Now that most of our cooling connections are finished, we're going to start working on our wiring next. On our old motor, our coil was mounted over here on the passenger side. We have plenty of room on the driver's side, so we're going to move it over here, and then we're going to connect our oil pressure sensor as well as our temp sensor.

Start by mounting the bracket to the head. Grab our new MSD blaster coils, works well with our MSD ignition, MSD distributor. That in place, I'm going to finish the ignition line over to our distributor.

This is a factory harness that's going to go out to our engine. Black fitting down here is for O pressure sender. This is for the temp sender. This one would normally go out to the coil. It's a 12-volt switch power. Since we're using an MSD ignition, we're going to use that to switch the ignition to turn it on, which that'll return power of the coil.

We'll go over to passenger's side. We'll connect our alternator harness. Plug that in, and the ground for that as well as the ground for the battery will be underneath the car. Let's also reconnect our ground to the back of the head back here. Now reconnect 12 volts to the electric ground on our motor. Over around the alternator and the battery to the block. Move back now and connect our starter wire.

Now put the lower radiator hose up in the place. There's a bracket that might be in the way of the upper connection on the water pump, and you want to move it before you put the hose in. We're going to be using MSD's digital 6A ignition box to work with the distributor provided in our Ford Racing crate engine.

The wiring may look a little intimidating, but overall it really isn't too bad. The red and black go to power and ground, respectively. This purple and green plug here will plug right into our distributor. You weren't using an MSD distributor, this white wire here will work with a point-style ignition. The orange and brown are going to go to our blaster tube coil. The red is 12-volt switch to turn on our ignition, and the gray will work with an aftermarket tachometer.

We're going to mount our MSD ignition right here on the apron since most of the wirings in this area should make it a little bit easier to wire. We know the cam in our engine's going to have a little bit of a rowdy idle. Because it's an electronic component, we want to dampen a little bit some of the vibrations we're going to get from the idle. What we did, we took some unneeded fuel hose, cut these little spacers out. We'll put between the ignition and the metal, which will help dampen it.

We'll plug our harness in, we'll start making our connections. We'll start laying out our wiring. We're going to fish these across our radiator support. We'll tie them in here, out of the way. The white feed is not used; we'll take that out of our harness. Gray wire is going to go to our tach feed underneath our dash. The remaining three wires by slipping behind our washer bag. Plug our feed into our distributor. Use one of the MSD supply terminals on our 12-volt switch from our ignition. Connect that to the 12-volt switch lead for our MSD ignition.

Then we'll connect the orange and black leads to our blaster coil. Make sure you don't over-tighten these. Just get them snug. We'll hook up the 12-volts. We're not going to connect from the battery yet, I'm just going to put it on the terminal. Same with the ground.

We still have to hook up fuel, set the timing, prime the oiling system. A few other things before the engine will actually run. Curiosity is getting the best of us, though. We're going to test the ignition just to see if it'll bump over. We're good. Now we can move on to the fuel system.

We'll start the fuel system and put in the fuel line onto our carburetor. A little bit of thread sealant on the thread before we install. Now we'll install a 3/8 NPT barb fitting on our fuel pump to connect to our fuel line. Then put some thread sealant on there. Now we'll install the other fitting into our fuel pumps that connect to our factory fuel line. Our next step is going to be to prime our oil pump. Before we do so, we've got to fill our engine with oil.

We're using five quarts of standard 10-40 oil for the break-in. About 500 miles out, you probably want to change, then you can go to synthetic, whatever else you want to run. To prime our oil pump, we've got to remove the distributor. Then we'll actually put a drill on the oil pump and turn it to build up pressure. Since we're taking the distributor out, we will have to reset the timing on the engine. To do that right, you're going to pull all the spark plugs out, making the engine much easier to turn so we can find top dead center.

We're going make a mark on the distributor where number one is. I'll need an impact gun or a drill, a long quarter-inch extension, and a quarter-inch socket. If they have a locking extension, you're good to go. If you don't, I'd recommend taping this to the extension. You don't want to lose it inside the engine. Now you want to run it in reverse until you start seeing oil come up inside there.

Now we're trying to find close to top dead center so we can reinstall our distributor. Not a bad idea to get a little bit of help for this part. You'll want to put your finger in the number one cylinder hole and then turn the engine until you feel a pop and you're on the compression stroke. Now that we're on the compression stroke, we want to put a screwdriver in the hole, turn the engine until the screwdriver lifts all the way up to its top point. I want to turn our rotor just past our paint mark for number one, because once we drop the distributor in, it is going to spin.

The last step before we can try starting the engine is hook up our throttle rod. Put a washer and then put a cotter pin in to hold it in place. That will install the plate from the throttle returns spring. We took off our old loader. Now that our throttle's hooked up, we'll give everything a once over, and we'll fire it up. Or maybe you'll want to put your exhaust on first, but we want to hear this thing with open headers.

I would try cranking the engine a few times. It'll take a while for it to start because we have to get fuel in the line. The pump has to pull it up into our carburetor before it'll even run. All right. Go ahead.

Wooh! Our Ford Racing crate engine sounds absolutely sick with the open headers. Now we're going to reinstall our suspension, put some fluid in the transmission and fill the radiator. We'll get this thing ready to get back on the road. Take a couple gallons that will fill the system initially and probably another gallon once we get all the air out of the system with the engine running.

Now we can fill our transmission with ATF. If you want to fill it until the fluid comes back out the fill hole where you're putting it in. We decided to add a little bit of show to all the go that we're adding, so instead of putting our mismatched silver and black export brace and Monte Carlo bar, we're going to upgrade to a pair of matched chrome premium products.

So that's the basics on how to install a Ford Racing crate engine into your classic Mustang. On our particular '67, we do still have a couple issues we need to address. The engine includes an air gap intake, which is taller than the stock intake. It's going to create a clearance problem with our hood, so we are going to have to go with an aftermarket hood in the future.

You may also notice we did not install our exhaust system. The exhaust on the car just wasn't up to par with this engine. So in a future video, we're going to do an exhaust upgrade, as well. While this is not an easy installation, it's something you and a couple of friends could definitely tackle over a weekend. You'll be back on the road in no time.